Richard Cheshire is in an upbeat mood as he arrives in Edinburgh to check on preparations for the first Krispy Kreme store in Scotland, writes Gareth Mackie.
The doughnut retailer has had a presence in the UK for almost ten years but is only now making its move north of the Border, and Cheshire – the firm’s joint managing director – insists it will not stop there.
“Depending on how people respond to the business and how successful we are, we would envisage between six and ten stores over the next two years,” he says.
“We’ve hired 70 people so far in Edinburgh, which means we’d be hiring at least 200 people if we had eight stores.”
Cheshire says the firm has a strong track record of nurturing talent, and he would not be surprised if one of the Edinburgh staff ended up being responsible for the whole brand within Scotland in five years’ time.
“Our logistics manager started out driving a single truck five days a week,” he says.
“Seven years later, he runs a fleet of 35 trucks and has 120 people reporting to him. It’ll be no different in Scotland, and I’m really excited about meeting them team over the next two weeks.”
The Hermiston Gait drive-through, which is due to open on 13 February, is designed to act as a “hub” outlet, providing doughnuts for three to four smaller satellite stores.
Cheshire is already in talks about expanding into Livingston and Stirling, and is aiming to open a store in central Edinburgh, “but that’s a little more complicated because there’s not so much availability”.
The Edinburgh outlet, near the sprawling Edinburgh Park development to the west of the city, is also expected to supply nearby Tesco branches, building on the chain’s relationship with the supermarket giant.
Longer-term plans could see Krispy Kreme UK, which opened its first UK store in London’s Harrods department store in 2003, expand into Aberdeen, Dundee and Glasgow. Cheshire has come a long way since he started out in the food industry – his first job saw him washing dishes at the age of 17 for American-themed eatery TGI Friday’s.
“That was a fantastic place to land, completely by luck,” he recalls.
“It’s a business with great people, quality and service, and I spent just under ten years there. I wasn’t particularly skilled at making money in those days, but then I spent four years with the Restaurant Group, which had a bit of a different culture. That was more about making money and looking at the real side of business.”
He joined Krispy Kreme UK as operations director in 2003, a position he held for seven years before becoming chief operations officer.
Along with fellow joint managing director Rob Hunt, he was involved in a £25 million management buyout in October 2011. That deal saw private equity firm Alcuin Capital Partners, which has also invested in coffee bar chain Caffe Nero, take a majority stake in the business.
Cheshire says: “The whole transaction worked out extremely well. Everyone got a fair price, but there’s still lots to do for the future.”
On the immediate horizon, though, is the Edinburgh store, where he predicts 100 people will be waiting patiently to be the first to sample its wares.
“It’s a tradition that’s gone on more many years, and it’s part of the heritage of the brand,” he says. “People are so enthusiastic to be the first in the store, and they’ll camp out 24 or 36 hours in advance.”
While gadget fans have been known to queue for days to get their hands on the latest videogame console or other electronic must-have, it seems unlikely that doughnuts would attract the same fervour, but he insists the comparisons with the likes of Apple are not pie in the sky.
When an updated iPad launched in 2011, 500 people queued outside Apple’s Cardiff store to snap up the tablet computer.
Cheshire says: “When we opened in Cardiff a week later, we had 1,000 people in line.”
Krispy Kreme was founded in North Carolina in 1937. The US group licenses out the brand in international markets but does not have a stake in the UK franchise.
Cheshire says: “It’s very much a UK business and we own everything here. No-one else is getting their hands on it. We’re very proud and passionate about what we do and like to control as much as we can.
“We’re serious about business but we don’t take ourselves too seriously. It’s all about having fun.”
The Surrey-based chain employs about 1,200 people and opened seven stores during the year to January 2012, giving it a total of 45 outlets. The expansion helped revenues jump 26 per cent to £42.3m. Pre-tax profits almost doubled to £1m, and the firm says more than 100,000 people visit its stores each week.
Cheshire says the hub branches, or “hotlight” stores in Krispy Kreme parlance, are a visitor attraction in their own right, where families can watch the “theatre” of doughnut production.
“There’s a huge machine with a viewing window so people can watch the flour and yeast being mixed, before 2,000 doughnuts at a time go into the oven,” he says, visibly enthused at the thought.
“If you’re lucky enough to be in the store when we’re making our signature original glazed product, you get a complimentary one. If you’ve taken the time to watch the process, we want to reward you for doing that.”
He acknowledges concerns over the health aspect of fast food and insists that the firm takes topics like obesity “very seriously”, but says the average customer makes only seven to eight visits a year.
“We know that people use us as an occasional treat. That’s what we’d like them to do; we’re very happy for them to have a coffee here on a regular basis, but it’s all about a balanced diet.”
The firm’s original glazed doughnut, which makes up 25 per cent of its total sales, contains 217 calories.
Cheshire explains: “That’s less than half an egg sandwich or a bag of crisps. People may be pleasantly surprised that it’s not really as naughty as they thought.”
Born: Birmingham, in 1968.
Education: Arthur Terry School, Sutton Coldfield.
First job: At a TGI Friday’s.
Ambition while at school: To be a footballer, but I did think about becoming an architect.
Car: A five-year-old Audi.
Kindle or book? I’ve never learned the art of finding time to read books, but I read a lot of e-mails.
Can’t live without: My wife and children.
Favourite place: New York.
Favourite doughnut: Hot original glazed.
Best thing about your job? Seeing the customer’s face when they’re having a hot original glazed – and helping people achieve their goals.